.mac membership why i have just been charged £68.99?

marknicholls said:

.mac membership is $99 i have just paid for my membership and been charged £68 which equated to $128?

Any have any ideas why?

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Oh, no-- Europeans are up in arms because Apple priced the Mac mini too high! At least, that's what CNET reports, as it tells of an online petition protesting Apple's decision to charge €489 for the entry-level mini, which, at today's exchange rate, comes to roughly $639.19-- a whopping $140.19 more than the US price, or 28 percent higher. And sure, we'd be the first to agree that a pricing discrepancy that out of control would warrant even such drastic action as asking a bunch of random 'net surfers to type in their names and click a button. (What, no guillotine? 28 percent, people!)

Here's the thing, though: CNET never mentions that Apple's European pricing includes the horror of VAT, the per-country sales taxes in Europe that are annually responsible for thirty to forty vacationing New Hampshire residents dropping stone cold dead on the spot when they encounter taxes of at least 15 percent on practically everything they see. In Germany, for instance, the €489 price tag on the entry-level Mac mini clearly states that the price is actually €421.55 before the 16 percent tax; that's roughly $551.02-- still about 10 percent higher than the $499 we pay here in the States, but a darn sight less brain-seizing than the $639.19 it looks like Apple's charging, from which it has to cut the State in for its piece of the action. And in France it's even worse; the price for a Mac mini there is €499 after tax, but €417.22 ($545.36) before it. That's a 9.3 percent before-tax price premium for French customers-- and a 19.6 percent tax markup, which, frankly, makes us want to go fetal in the corner and sob uncontrollably.

But while CNET seems to have neglected the issue of VAT, the authors of the petition did not; they simply feel that Apple charging Europeans 10ish percent more for the same Mac mini as they charge Americans is unfair. And ultimately, sure, it probably is-- though that's not necessarily Apple's fault. We're not claiming to know Apple's reasons for pricing things the way it does, but while the petition's authors note that Apple's "profit margin is the same, independent from the sales location" and "transport costs are equally the same for delivery to customers in the US and the EU," they never address the possibility that maybe, just maybe, Apple's cost of doing business in foreign countries is higher. Maybe we're being naïve about this, but spending two weeks in London sucked cash from our wallets so fast the suction made our buttocks cave in. So if it costs more to live there than here, isn't it possible that it costs more to run a business there, too? And that Apple might want to factor that added cost into its product pricing in countries where it spends more money to generate each sale? Just a thought.

In fact, a quick-and-dirty, completely unscientific test of that theory may lend it some weight. We pulled up Dell's web sites for the US and the UK (just so we wouldn't have language issues, monolingual ignoramuses we are) and compared low-end desktop prices between here and there. The cheapest system we found offered for sale on both sites was the Dimension 3000, and after configuring both systems as closely as possible and subtracting out the included UK VAT of 17.5 percent, we found that the UK price was still nearly 15 percent higher than the US price. Time for another petition? (Okay, we admit it: variables like Dell's promo pricing on different options in each market make this test pretty much worthless. Beats workin', though.)

In any case, there's some indication that Apple did tone down its European markup specifically for the mini; a quick spin through the French Apple Store reveals that the price premiums on entry-level eMacs, PowerBooks, and iPods are 12 percent, 11.3 percent, and a whopping 19.7 percent respectively. Suddenly a 9.3 percent markup on the Mac mini doesn't look quite so bad. Don't get us wrong, here-- we'd love to see Apple lower its pricing in Europe, because there's a huge market of benighted Wintel users over there just waiting to be converted into slavering, cash-dropping Mac fans. But from what we can see, the Mac mini's pricing in Europe is at least in line with the prices of other Apple hardware, if not better. Whether that's good enough remains to be seen; apparently there are at least 6,000 people out there who say it's not. So let's just sit back and wait for the sales figures, shall we?

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marknicholls said:

As much as i love apple, that is BANG out of order. Admitidly it did ask me to confirm i was happy to pay £69.99 BUT i only set up the trial account as i thought when i was ready i would then be able to get the full memberhsip for only $99. Of course, i have now been using it for free for 2 months, so all my online shopping accounts, friends, forums etc have my new email address and i really cant be botherd to changed it again (plus i am happy with .mac) but it is slightly annoying

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Duff-Man said:

Duff-Man says....the subject of Apple's prices in other countries comes up around here, and other boards, quite often. Yesterday there was an article on As the Apple Turns that touched on this subject and the petitions.....and I think it makes a very valid point that the cost of doing business in some countries is just higher than the USA and that gets reflected in the prices of the goods....does not matter that the stuff is actually made and shipped from elsewhere - Apple has to pay their UK (in this case) staff at the "going rate" in London, and the payroll taxes etc that go along with that. The poiint was also made that this price differential is not something that is unique to Apple.....the article is quoted below...oh yeah!

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Chip NoVaMac said:

Thanks for the article. It still does not answer the question of what added costs that Dell or Apple have in doing business there. Are there duties that we are not fully aware of? Are corporate taxes higher there? That could be the answer to the 10 to 15% difference.

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Duff-Man said:

Duff-Man says....everything is more expensive there. For me, a lot of things that are $2cdn are £2 there...that is like $4.70cdn to me. And it is not just in England either....the coffee that I might buy at my local Starbucks for $1.75cdn I paid about 4chf for in Zurich - about $4 to me.

To use another example...try comparing the price of fuel for your car. Hey, they are a lot closer to Iraq and Kuwait and Suadia Arabia so it should be cheaper there, right? Nope. Try 30 - 40% more.

It is different wage structures, different corporate tax rates, different costs of living...the old saying about comparing apples to oranges....people really don't think abouit these things before they spout off about Apple Computer "ripping them off".....oh yeah!

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marknicholls said:

.mac membership is $99 i have just paid for my membership and been charged £68 which equated to $128?

Any have any ideas why?

Click to expand...